CONTENTS• Channels of Distribution• Services marketing Mix• Target marketing position• Delivering of service / Service performance• Services Gap analysis• Service blue print•Conclusion
STARBUCKS - An Overview •The Starbucks Coffee, Tea, and spices company was founded in Seattle in 1971 • It is the largest Coffee house company in the world, with 20366 stores in 61 countries.“To inspire and nurture the human spirit --- one person, one cup, and oneneighborhood at a time.” ---- Starbucks Mission statement
Target Market and Positioning•Positioned it self as an upscale brand - not just coffeeproducts but a “rich experience” – Selling point• Social Classes• Small towns, rural communities, ethnic neighborhood.
SERVICES MARKETING MIX - 7P’sPRODUCT•30 varieties of whole bean coffee to ecofriendly cappuccino, pastries,Smoothies, wraps.• Live coffee Mantra•Sodas, juices, coffee-related accessories, equipment, music CDs, noveltyItems.•Varied from store to store.•JV with Pepsi-Cola for Frappucino, Dreyer’s for premium iceCreams.
SERVICES MARKETING MIX - 7P’sPLACE•Located in high traffic, high visibility settings – retail settings, officeBuildings, university campuses.•In-store at Barnes & Noble and Target.•Target - Individuals on the go.•Localization – “Stealth outlets”.“we want to reach customers where they work, travel,shop, and dine.” -----Starbucks philosophy.
SERVICES MARKETING MIX - 7P’sPRICE•Priced high – perceived upscale image.•Later introduced “value strategies”.•Breakfast pairings.•The average ticket price is $3.85.
SERVICES MARKETING MIX - 7P’sPROMOTION•Starbucks card – referral system.•Corporate sales card.•Delivery to offices without restriction.•Appealing to diverse customer base – international products.•Philanthropy – contribution to non-profit organizations.
PeopleSERVICES MARKETING MIX - 7P’s Process Physical EvidencePeople•Core ingredient•“Happy customers” start with “happy staff”• “ we are not employees – we are partners”•Employee turnover rate of 70% compared to the fast food industry averages of 300%
PeopleSERVICES MARKETING MIX - 7P’s Process Physical EvidencePhysical Evidence• Custom made cup of beverage.• Clean, friendly environment , cozy chairs, sofas.• Alluring pastries menu , “tasty” show cases, tempting coffee pictures.
PeopleSERVICES MARKETING MIX - 7P’s Process Physical EvidenceProcess• Legendary Service• Sequence service reducing queue.• Contact less payment – Barclay , I phone and Android app
Company Owned Outlets FranchiseChannels Of Retail StoreDistribution licenses Grocery Stores and Warehouse Clubs B to B, Airlines restaurants
Service BlueprintStage in Production Obtain Take Make Deliver Pay forProcess Seat Order Order Order OrderTarget time (minutes) 1 1 3 3 1Critical time 5 5 8 8 3Participants Customer Customer Cook Customer Customer Waiter Waiter CashierVisible evidence Furnishings Staff Tea, Crockery, Manner Cash Collection Appearence of service ProceduresLine of visibility Cleaning Preparation of AccountingInvisible process of room Ordering of Procedures supplies
Expected Service Perceived ServiceService DeliveryCustomer driven service designs and standardsCompany perception of consumer expectations
Gap Analysis • Customer satisfaction gap could primarily be attributed to a service gap Between key attributes and customer expectations. • Speed of Delivery considered as criticalBridging the Gap •An additional 20 hours of labor, per week, per store •Service time down to a strict 3 minute level.
Conclusion :“ We aren’t in the coffee business, serving people. We are in the people business Serving coffee” --- Howard Schultz (Serwer, 2004) Starbucks claimed their leadership by focusing on a strategy of new products, A stronger connection with customers, rapid expansion, and uncompromised quality